Government’s shutdown has impact on ag

Federal agricultural policy experts report that damage to agriculture due to last week's shutdown of the U.S. government, which occurred for the first time in 17 years due to a gridlocked Congress, will be a wait-and-see situation, at least for the short term. However, those harvesting timber on federal lands expect to feel the effects right away due to Monday's shutdown of logging operations on national forests by the U.S. Forest Service.

"The national office has sent a letter to the regional offices in the Forest Service providing the direction to the timber contracting officers to suspend all existing contracts," said California Forestry Association Vice President of Public Resources Steve Brink. "This will be an impact one way or the other. The best-case scenario if a project gets suspended on public lands, there will be a few opportunities where the wood contractor could move to private land, but a move out and into another job is expensive."

Brink added that timber operators believe purchasers will have up to seven days to remove trees that have already been felled and, if the suspension continues during the wintertime, to do erosion control work.

"Our normal operating season in California usually runs to Oct. 31, but it is always weather-dependent," Brink said. "You can work outside of the normal operating season when the weather allows; the contract allows that."

Washington began bracing for a government shutdown on Oct. 1, after House Republicans demanded that the nation's new health-care law be delayed or repealed and President Obama and the Democrats refused to give in. The government is expected to remain closed until Congress passes a continuing resolution. As a result, federal agencies proceeded with the closure of nonessential operations and the furlough of employees.

Other government shutdown impacts include the lack of market information from the U.S. Department of Agriculture, National Agricultural Statistics Service, Economic Research Service and the Agricultural Marketing Service, which producers use to make decisions such as which commodities to grow and when to sell them.

"This shutdown of the government brings many headaches to Americans. This is one of ours," said Michael Marsh, chief executive officer of Western United Dairymen. "The lack of publicly available market information does impact our dairy farmers. The USDA data impacts markets and provides valuable information related to market trends and conditions."

Barry Bedwell, president of the Fresno-based California Grape and Tree Fruit League, said while his organization is still learning about how farmers might be affected by the shutdown, he remains concerned about the impact on promotion of California specialty crops overseas.

"Even though we are winding down on tree fruit, we have three-and-a-half months of grape shipments to do," said Bedwell, who was in Washington, D.C. last week.

"When you ship 40 percent, you worry about the systems that are in place. Some are user-funded and some aren't. To get those inspections, approvals and get that stuff exported, it is going to be very important," he said, adding that Congress needs to take responsibility.

After a briefing with USDA last week, American Farm Bureau Federation cited that producers should expect delays in conservation funding, technical assistance and approval of payments by the Natural Resources Conservation Service. This could be a problem for those producers who have scheduled conservation work in advance. Also, during the shutdown, the Farm Service Agency is unable to obligate loan funds, the majority of which are issued in the fall.

"I'm hoping that out of all of this comes an attitude that talking to people across the aisle is not wrong; it is what is needed. We need the ability to compromise and move issues forward," Bedwell said. "I hope there's a quick resolution to this."

While the stalemate over fiscal and healthcare issues continues, Congress failed to produce a farm bill by the Sept. 30 deadline, which means federal agricultural policy is set to revert to permanent law.

"We need a new farm bill. The House needs to appoint their conferees and the conference committee needs to roll up their sleeves and pass a bill that can move through both the House and the Senate and achieve a presidential signature," Marsh said.

An extension of the current law would have to take place before Jan. 1 before farm policy would revert back to permanent law.

AFBF President Bob Stallman said, "Now that the 2008 Farm Bill extension has expired, farmers once again are left with uncertainty as to the safety net and risk management tools that are important in planning for next year's crop. And come January, consumers once again face the impact of high food costs as decades-old farm policy kicks in."

Another critically important issue for agriculture is immigration reform. House Democrats introduced a comprehensive immigration bill last Wednesday that largely mirrors the Senate version, although some changes have been made to the border security provisions. The bill would create a pathway to citizenship for millions of illegal residents.

(Christine Souza is an assistant editor of Ag Alert. She may be contacted at csouza@cfbf.com.)

Permission for use is granted, however, credit must be made to the California Farm Bureau Federation when reprinting this item.